Well, there’s one bit of good news around: the Chinese economy has avoided flopping into recession or a credit crunch amid all the hue and cry over America’s credit rating cut and the market instability surrounding that.
Compared with what’s happening in the US and Europe with the economies weakening and markets falling, China is stable.
Yes, the market hit a 12 month low this week, but that’s better than the two year lows markets elsewhere had hit, and will hit today after another night of nervous dealings in Europe and the uS that saw huge falls.
Growth in Chinese industrial production slowed last month, with car sales down noticeably, but retail sales rose, while urban investment eased a touch.
And China’s trade surplus widened sharply in July, boosted by stronger export and import growth.
The trade surplus expanded to $US31.5 billion from June’s $US22.27 billion.
That was significantly ($US4 or $US5 billion) above estimates from the markets.
July exports jumped 20.4% year-on-year to reach $US175.128 billion, compared with 17.9% in June.
Imports increased 22.9% from a year ago to $US143.64 billion, up from June’s 19.3% rate.
Industrial production rose an annual 14% in July, down from the stronger than expected 15.1% rise in the year to June, but in keeping with the contraction shown in the two monthly manufacturing surveys at the start of this month.
The Statistics Bureau said output grew 14.3% in the seven months to July.
On a monthly basis, industrial value-added output rose by 0.9% in July from June.
In May, year-on-year industrial value-added output growth hit a seven-month low of 13.3% thanks to the impact of government monetary policy tightening measures and the end of the country’s stimulus policies.
July car sales fell 6.1% from June to their lowest level in a year (except for the holiday-hit February); a real sign that the tighter credit conditions are having an impact wider than in property and industry.
The country’s car industry group said domestic sales of cars, sports-utility vehicles, multi-purpose vehicles, and minivans dropped 957,724 units in July.
While that was up 3.6% from July of last year, industry reports said that was not a positive sign.
July 2010 was the weakest month for the industry last year and car groups are expecting to see the annual rate fall in August with weakening sales forecast.
China’s inflation rate accelerated to a 37-month high of 6.5% in July, up from a three-year high of 6.4% in June.
Producer prices rose an annual 7.5%, up from 7.1% in June, while non-food inflation rose 2.9%.
Urban investment remained solid, rising 25.4% in the seven months to July, down slightly from the 25.6% rate in the six months to June.
In the first seven months, investment in the primary, secondary and tertiary industries rose 22.8%, 26.7% and 24.5% respectively.
The Statistics Bureau said investment in the nation’s property sector rose 33.6% year-on-year to reach 3.19 trillion Yuan, of which 2.28 trillion Yuan went towards residential housing, an increase of 36.4% over the same period last year.
And China’s retail sales grew 17.2% in July compared with the same month of last year, up 1.26% from the year to June.
From January to July, the country’s retail sales rose 16.8% year-on-year.
